Strange options action

T

Took2Summit

Posted this in my journal as well, but would like an answer so copying here in hopes to get a response:

This might seem like a pretty dumb question to some but I admit I am new to this strategy. I see this anamoly occur every now and then and would like to make sense of it.

Today Macy's common is down about 0.33 as of writing this. My sold call for 22 Oct 27 strike is up 0.22 (over 38%). I couldn't find any news on Macy's, there is no upcoming earnings prior to expiration day, no dividends, no major news that I can find, and on top of that the VIX is down today as well.

I've noticed this happening one or two other times in different underlyings as well during my venture in this strategy. Can anyone help shed light as to why this is happening?

Thank you.
 
Your question makes no sense.
M oct 27 calls closed .88-.91 yesterday and they are .74-.77 now with the stock down a little.
You can’t ever look at “last” with options, always track the bid/ask.
 
Quote from Took2Summit:

This might seem like a pretty dumb question to some but I admit I am new to this strategy. I see this anamoly occur every now and then and would like to make sense of it.

Today Macy's common is down about 0.33 as of writing this. My sold call for 22 Oct 27 strike is up 0.22 (over 38%). I couldn't find any news on Macy's, there is no upcoming earnings prior to expiration day, no dividends, no major news that I can find, and on top of that the VIX is down today as well.
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Most questions aren't really dumb because it's just something that someone doesn't understand. OTOH, many answers are another story :)

There are a number of reasons why a call goes up while the UL goes down. The most common are what you've mentioned - earnings, dividends, news. Others could be:

1) an intraday change in IV

2) the option trades sporadically so last trade price doesn't correlate in properly in time

3) delayed quote update (broker issue)

4) a bad print by exchange

5) an outlier trade (dumb money)

6) Painting the tape (wink)
 
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